iifl-logo

Invest wise with Expert advice

By continuing, I accept the T&C and agree to receive communication on Whatsapp

sidebar image

Q4FY23 Review: Navin Fluorine Intl: Q4 an aberration; H1FY24 to see moderation

15 May 2023 , 02:16 AM

Q4FY23 was an exceptionally strong quarter for NFIL, driven by execution of bunched-up orders in CDMO (including US$16mn order received in Q2). However, we anticipate some challenges in H1FY24 earnings, led by longer-than-expected HPP plant shutdown, pressure on agrochemical intermediate and seasonally low CDMO performance in H1FY24.

Q4 earnings positively skewed: 

NFIL’s earnings continue to scale up, on the back of ramp-up of HPP unit and incremental contribution from MPP and agrochemical-dedicated plant. Besides, share of CDMO revenues inched up significantly in Q4, driving to overall beat. Specialty Chemicals revenues missed IIFLe by 12%, given volume decline within an agrochemical intermediate.

FY24 earnings to be back-ended: 

Analysts of IIFL Capital Services anticipate some challenges in H1FY24 earnings, led by lower HPP volumes, pressure on agrochemical intermediate within specialty chemicals and seasonally low CDMO performance in H1FY24. To their surprise, HPP plant shutdown of 3 weeks after operations of merely 8-9 months, looks optically very early and elongated. NFIL’s one agrochemical intermediate within specialty chemicals unit is witnessing demand pressure.

Maintain cautious view on stock: 

Going forward, analysts of IIFL Capital Services have pegged revenue/Ebitda growth forecasts of 23%/25% over FY23-26. While the underlying projects are progressing in a timely manner, global challenges may dampen performance of base business. Management will seek Board approvals for cGMP-4 and a specialty chemical project. At ~37x/32x FY24/25 P/E, valuations are very rich and factor in traction in earnings from upcoming growth projects, thereby leaving no room for disappointments.

Analysts of IIFL Capital Services trim FY24-25 EPS by 1-4%, to factor annual shutdown of HPP unit, weakness in agrochemical intermediate within specialty chemicals (excluding MPP and dedicated plant) and higher finance costs. TP, rolled over to Jun’24, revised to Rs3,980 (30x Jun-25 P/E) from Rs3,960. Maintain REDUCE.

Related Tags

  • Navin Fluorine Intl
  • Navin Fluorine Intl Q4
sidebar mobile

BLOGS AND PERSONAL FINANCE

Read More
Knowledge Center
Logo

Logo IIFL Customer Care Number
(Gold/NCD/NBFC/Insurance/NPS)
1860-267-3000 / 7039-050-000

Logo IIFL Capital Services Support WhatsApp Number
+91 9892691696

Download The App Now

appapp
Loading...

Follow us on

facebooktwitterrssyoutubeinstagramlinkedintelegram

2025, IIFL Capital Services Ltd. All Rights Reserved

ATTENTION INVESTORS

RISK DISCLOSURE ON DERIVATIVES

Copyright © IIFL Capital Services Limited (Formerly known as IIFL Securities Ltd). All rights Reserved.

IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248
ARN NO : 47791 (AMFI Registered Mutual Fund Distributor)

ISO certification icon
We are ISO 27001:2013 Certified.

This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.